This is a guest post written by My Moving Reviews, they can help you find a mover that you can trust if you do have to move!
As a whole, moving is considered as the third most stressful experience right after events like death in the family and divorce. People move for various reasons, but mostly due to a new job. When you are offered a new career opportunity far from your home, inevitably comes the question: “Should I accept and move?” In order to make a sensible choice whether you should move, you should take into consideration all of the aspects involved in such endeavor, not just a couple of the factors. Like in every other decision in our life, pros should outnumber cons, otherwise instead of beginning a fresh story with enthusiasm and confidence, we might find ourselves in a woeful story feeling so frustrated.
Salary And Living Standard
Moving for a job doesn’t necessarily mean that you will make more money and have a better standard of living. You are offered a bigger salary, and you accept the job offer without considering the cost of living in the area you will live – do not take that risk. Another mistake you should avoid is not supplying enough financials for a couple of months ahead. People who have lined up a good job before the move tend to be too confident. When the fine line between confidence and cockiness is crossed, bad things happen, figuratively speaking. When you have secured a steady income, that doesn’t mean you should ignore the “saving-money step” of the relocation process.
Other moving related tasks that have to be taken care of concern the properties – the one you will leave and the new one you are moving in. There is not much to be discussed if you are renting the old place, but the fact that you have to notify your landlord in a timely manner and deal with the paperwork. On the other hand, if you are selling the property, keep in mind that you will have to pay brokers’ and lawyers’ fees. Also, an extensive research on the real estate market in the new area should be done. A common mistake that people who move due to a job make is rushing to buy a new property instead of renting at first. Sometimes, making a great deal means you have to wait a bit. Furthermore, getting familiar with the new environment will help you decide which neighborhood to choose to settle in.
Finding Reputable Movers
Moving is not a one-day job, but many people seem to approach it as a one-day engagement. If you don’t research movers, you can end up dealing with an unscrupulous and rogue moving company. This causes not only a lot of distress, but financial blunders too. Damages caused by movers might estimate in thousands of dollars. A moving company have to be registered with the Department of Transportation in order to operate legally. In some states like New York, Texas, California and Massachusetts additional certification is required by the local authority. When selecting a mover, look up their online reputation, read reviews and check the BBB record. Reading carefully the moving company’s paperwork before the moving day can ensure a safe ride for your belongings as well as make you aware of the possible problems that may occur between you and the mover. A very important and often forgotten precaution is purchasing insurance for the valuables. People usually confuse liability with insurance. By federal law, basically movers assume liability for no more than 60 cents per pound per item. In order to move a home cost-effective, you should get acquainted with all the potential moving related costs. Movers usually give price estimates for the moving service, but exclude fees for stairs, shuttle, long carry, packing labor, packing materials, hoisting, fuel surcharge and other small additional expenses in the initial quote. Many consumers find out about these fees no sooner than the moving day. If you want to manage the financials of the move successfully, full tariff should be required with all the company rates.
Cost Of The Move
The major cost-forming factors for interstate moves are the total weight of the household belongings and the packing services. To find out more about the average price, make sure you get an estimate, especially when moving a long distance. When moving locally (within the same state), moving companies usually charge per hour. In that case, factors as the number of stairs and the traffic between the both locations could greatly influence the price. And if the move is an overseas one, moving costs depend on the cubic feet. Plus, Customs’ fees apply and amplify the final cost of the moving.
The average cost for a long distance move such as move from New York to California for a 2 bedroom home is about $5000 – $6800 and this does not include the packing. The total cost for a full service move could easily go to about $7600. The major cost-forming factors for interstate moves are the total weight of the household belongings and the packing services. When moving locally (within the same state) moving companies usually charge per hour. In this case, factors as the number of stairs and the traffic between the locations could greatly influence the price. Moving a 2 bedroom home 20 miles away could cost about $900 to $1500 if packing service and packing materials are included. And if the move is an overseas one, moving costs depend on the cubic feet. Plus, customs’ fees may apply and amplify the final cost of the moving.
*The below post is a guest post from BusinessesForSale.com, great post about funding new ventures!
In the current economic climate, banks are still cautious about funding new ventures. There are plenty of less conventional ways to raise finance, however, one of which might suit your needs. Consider one of the following:
1. Crowd funding
Websites like Kickstarter and Indiegogo make it easy for new products and services to find their audience. With crowd funding, backers can pledge to support a project they’re interested in. If the amount pledged reaches the project’s target, funds leave the backers’ bank accounts and go into the project’s, while if the target is not reached the backers do not have to pay. Pledges can be as small as a dollar or go into the thousands, with rewards ranging from a simple thank you to a stake in the business. With crowd funding, your business can be funded by dozens, hundreds, or even thousands of individuals.
Consider this: if your business idea is innovative and appealing.
The downside: if the funding target is not reached, you receive nothing.
2. Seller finance
It may be possible to negotiate a deal in which the seller of the business you’re interested in lends you the money, or part of the money, to buy it. This can result in a quick, easy transaction in which the buyer pays less for the business, yet the seller receives more. The two parties should draw up an agreement listing the terms of the sale, including the rate of repayment, the final amount to pay, and everything included in the sale of the business.
Consider this: if the seller is as eager to sell as you are to buy.
The downside: can be risky on both parts.
3. Re-mortgage your home
You might already be in possession of the funds you need to start your business. They’re just wrapped up in your home. Taking out a second mortgage on your property or renegotiating an existing mortgage can be a way of releasing capital for you to spend on your business.
Consider this: if your business is the most important thing in your life.
The downside: as with any loan involving your home, consider the risks if you are unable to keep up with repayments.
4. Angel investors
Wealthy individuals who invest their own money in business ventures are known as angel investors, or simply angels. Whether motivated by personal interest in a project, by the prospect of later gain, or both, they can provide an essential injection of funds. In return, your angel may become a stakeholder in the project with a say in how it develops, or they may receive shares in the business but keep out of decision making. Websites and networking can help you connect with a suitable investor.
Consider this: if you need a hero.
The downside: you’ll need to prove your business is an attractive prospect.
5. Find a high-net worth business partner
Similar to option 4, but you’re looking for a partner rather than an investor, which requires a slightly closer relationship. Your business partner will share the responsibility for the business, and their name will be alongside yours on the paperwork. Whether they provide much actual input, other than financial, is for you and your partner to arrange between you.
Consider this: if you love to share.
The downside: potential clashes if you and your partner disagree over a business decision.
Sara Aisenberg is the executive writer for http://www.suretybonds.com, a nationwide surety provider that helps new business owners fulfill licensing requirements on a daily basis.
It’s been proven time and time again that good habits start at a young age, and personal financial management is no different. As a parent, it’s your job to help your children pave the road for future success, so consider the following lessons when teaching your children about money.
paidtwice’s note: When a new site run by a seasoned blogger, ABCs of Investing, approached me about running a guest post for them, I was intrigued. And the post itself really drew me in. As an investing newbie who is flying by the seat of her pants, I’ve appreciated the short, informative posts that appear on their site twice a week. So without further introduction, I hope you find this post as interesting as I did.
Do you clip coupons to save money? Do you know the “normal” prices of items on sale? Do you monitor your spending closely? Do you know anything about your investment costs?
Investments - they are one of those possessions that people love to ignore. As long as they have some then everything is ok and no further learning is necessary. Nothing could be further from the truth!
Retirement investments will usually end up being one of your larger assets and unless you have a good pension, one of your larger income streams.
Some of you might be thinking “I don’t have any retirement savings because I’m still working on my credit card debt”. But you will have savings at some point because you aren’t going to be in debt forever. Once you finish slaying the debt monster, then you should start using that free cash you have and save for retirement. You don’t have to be doing something in order to learn something about that something! Most people don’t want to read book after book on investing. They don’t want to go to a big website and read for hour after hour about investments. But they have to start somewhere and learning is the key to being a good investor. An informed investor is a good investor.
If you have already started saving for your retirement then congratulations! You are already on your way. However – do you know what kind of asset allocation you have? Do you know what asset allocation means? What kind investments do you own? What are the fees charged on those investments? What kind of accounts do you have?
You don’t have to be an expert on investments to be an investor but it sure helps to know something about them. It doesn’t matter if you have an financial advisor you work with – the more you know about investing then the better off you will be. Financial advisors are in business for their own profit – not yours. If you have to accept everything they tell you because you don’t know any better then it is time to get started with learning about investing.
Too bad! Nobody cares about your money like you do so it is up to you to learn as much as you can and make sure you aren’t being taken advantage of. Your partner is the investment guru in your family you say? Well, what happens if someday your partner isn’t your partner anymore and you have to do all the investing. Hopefully that will never happen to you, but if it does – wouldn’t it be nice if you had at least a solid knowledge of the investing basics?
My post Someone Had To Buy The House You Rent, asking how people can own rentals in markets that it is much cheaper to rent in than to buy, garnered tons of reactions in the comments as well as a few around the blogosphere. Mike from Quest For Four Pillars contacted me that evening and asked if he could write a guest post response to my post and I agreed. Here is his take. If you like what you see, consider subscribing the the Quest For Four Pillars feed! For a completely different view from a real estate investor, visit the response post written by Wise Bread’s Catherine Shaffer.
Last week, Paid Twice asked a very good question which I’ve paraphrased as “Why would someone own a rental property if it’s cheaper to rent than buy?” In other words, if you can’t collect enough rent to pay for your expenses (including mortgage) then why wouldn’t you sell the rental house and put the money into something more productive?
I’m not a real estate expert by any means but I do have some ideas about why this situation occurs and why it might not always be as illogical as it seems:
My theory about this phenomenon is that some house owners are irrational and attach great significance to ‘owning property’ and are willing to take lower returns in return. Real estate by itself is not necessarily more or less profitable than any other kind of investment for a given time period – over the long haul it has gone up by inflation plus 1 or 2% – but many people feel a strong connection with owning property that they don’t feel with any other kind of investment. Conceptually real estate is easier to understand than a stock or a mutual fund so some real estate investors just assume their rental houses are doing well and sometimes don’t do the proper accounting.
The recent decrease in real estate values has meant that people who moved in the last year or so often had to take a loss (or sell for less than they wanted) on their house so many of them decided to rent and “wait it out”. This may or may not work out for the home owner but it indicates that the owner is using their heart and not their mind when making a financial decision. This also increases the supply of rental properties which will lower the rents.
The example of someone who has a paid for house is a perfect example of where the owner might be better off selling the house and investing the money into dividend stocks or reits (like a real estate mutual fund) but they like the idea of owning and renting out a house. Because of the huge run up in real estate prices over the last ten years, there are undoubtedly a lot of owners who have done very well with their investment and are reluctant to let something go which has done so well for them. Logically you need to look at the current value of the house when evaluating the cash flow but a lot of real estate investors will think in terms of what they paid for it – which in some cases is so far out of date that it’s meaningless. ie if someone who paid $150k for a house 10 years ago and is getting $15k in rent per year might think they are doing well because the $15k is 10% of their original house price. Fast forward to today and if the house is now worth $350k then the $15k in rent is only 4% which is not enough to make it worthwhile. On the other hand, if you own a rental house outright – it’s easy to think you are doing well if the revenue is greater than your costs.
Real estate is a somewhat volatile investment so there are periods where there are significant increases or drops in the house value, but that doesn’t mean the home owner is going to sell just because they are doing poorly for a few years. Rental rates are set by supply and demand – not house price, so if there are too many rentals available in a city, then rents might not keep up with purchase prices. This situation has occurred in some areas over the last several years because interest rates were very low and lending standards were relaxed so in many cases it was cheaper to buy rather than rent so a lot of the potential rental pool became home owners which drove up the house prices and drove down (or kept steady) the rents. A real estate investor has to live through good times and bad if they are in it for the long run.
Selling a house is expensive and can be a lot of work – even in a hot market you are still looking at huge transaction fees of 5% or more which means that you can’t treat a rental house the same way you can treat a mutual fund or stock that you can sell very cheaply with a few clicks.
Very few home owners (rentals or otherwise) know how much their house costs them. We know what are various bills are and the mortgage and tax payments, but do we add them up over the years? Do we add up the various remodels? Do we consider the potential lost income or capital gains we could have gotten from investing the money in the stock market?
If there is a mortgage on the property then the portion of the mortgage payment that goes toward equity is not a cost since it is balanced with the increase in equity of the house. Another consideration is tax write offs – the rental owner gets tax write offs for maintenance, repairs, losses etc so that has to be factored in as well. Leverage is another tool which helps the homeowner if the house value rises in the long run. Because they are borrowing a portion of the house price, even a small rise in house value will get a larger return for the investor.
Prior to 2007, real estate values in most of the country had a pretty good run – 10% annual increases or more for at least five years which is way above the long term average. If you were a rental home owner during that time, you were probably too busy celebrating your new found wealth to do any kind of analysis to determine if the income generated by the rental property was high enough to justify ownership of the property.
Remember that with investment properties, you can’t just look at your cost of ownership – you also have to consider the potential income if you put the money into another investment like dividend stocks.
Whether owning a house is a better deal in your area or if rent is the preferable choice, you should keep in mind that over the long run it may not make much difference which you choose as long as you handle your finances properly. Many renters feel like they are going to be left behind because they don’t own a home but there are some steps they can take to make sure that doesn’t happen.
There are many reasons why there are rental houses in areas where it doesn’t seem to make a lot of sense – owners who don’t care, don’t know or are riding it out and hoping the rental market gets better – reasons abound. Remember that if you are considering buying a rental property yourself then do as much research as possible and whatever you do, don’t trust your real estate agent!